Rudy Giuliani Was DC Back-Office Fixer That Let Purdue Pharma (OxyContin) Slip Out Of A 2006 Criminal Indictment
Richard Sackler Unsealed Deposition Transcript in Kentucky vs. Purdue: https://www.documentcloud.org/documents/5745212-Deposition.html (2015)
How was Purdue Pharma able to slip through the 2006 criminal indictment noose and continue to market, sell and prescribe Oxycontin for another 10 years? Giuliani and GW Bush DoJ lawyers agreed to have Purdue Pharma parent “Purdue Fredrick Company” take the guilty plea, thereby permitting Purdue Pharma to continue selling Oxycontin and furthering the current opioid crisis.
By Mass Tort News
The US government secured a criminal conviction against Purdue Pharma in the mid-2000s but failed to curb sales of the drug after Rudy Giuliani reached a deal to avoid a ban on Purdue doing business including the federal government. The George W. Bush administration opted to settle the case instead, with the executives and the company paying $634.5 million in fines in 2007. How Rudy Guiliani slipped a fast legal maneuver past everyone is explained below.
That year, Purdue also reached a $19.5 million settlement with 26 states, including Massachusetts and the District of Columbia. But Healey’s office alleges Purdue continued deceptively marketing opioids after 2007. These settlement by various states are being used as ammunition in the current wave of opiate lawsuits versus Purdue Pharma.
2018 CONGRESS INQUIRIES INTO 2007 PLEA IGNORED
Congressman Mark DeSaulnier (D-CA) and Cummings Request Subpoena for Internal DOJ Report Indicating Purdue Pharma Concealed Knowledge of OxyContin Abuses.
In an attempt to uncover intel of Purdue’s bad conduct, Congressman Mark DeSaulnier and Ranking Member of the Oversight and Government Reform Committee Elijah E. Cummings sent a letter requesting that Chairman Trey Gowdy issue a subpoena to compel the Department of Justice (DOJ) to produce documents it is withholding related to an internal 2006 report that Purdue Pharma knew of significant abuses of its drug OxyContin shortly after it was brought to market in 1996.
“If this report is accurate, Purdue’s actions demonstrate a stunning disregard for human life and the law. While Purdue Pharma made billions of dollars from OxyContin, thousands of Americans succumbed to addiction and its consequences,” the Members wrote.
The 120-page report, obtained by the New York Times, reportedly indicates that Purdue Pharma knew OxyContin was highly addictive, but the company concealed this information and vehemently denied that it had knowledge of the growing illicit use until years after it had been on the market. Despite this deception, Purdue’s top executives managed to effectively avoid any responsibility.
According to the New York Times, the 2006 DOJ report recommended the indictment of “three of Purdue’s top executives on felony charges, including conspiracy to defraud. However, the political appointees at the Department of Justice under then-President George W. Bush reportedly overturned the prosecutors’ recommendations.
On June 12, 2018, DeSaulnier and Cummings sent a letter to DOJ requesting that it produce this report by June 25, 2018. DOJ did not respond to this request.
A full copy of the letter to Chairman Gowdy can be found here.
PURDUE PHARMA KNEW OF OXYCONTIN ABUSES
According to the New York Times’ report on the DOJ document, Purdue’s general counsel wrote in early 1999, “We have in fact picked up references to abuse of our opioid products on the internet.”
That same year, an OxyContin sales representative wrote in an email, “I feel like we have a credibility problem with our product,” after a doctor in Florida was arrested for illegally prescribing the drug. Sales representatives were discouraged by Purdue from raising concerns about abuse, with one saying his manager told him that “his job was to sell drugs, not to determine if a ‘doctor was a drug pusher.’”
PURDUE OPIATE PRESCRIPTION LAWSUITS IN 2018
Connecticut-based Purdue Pharma is facing a wave of civil lawsuits as more than 25 states including New York, Texas, Florida, Illinois and other states have joined a growing number actions against Purdue Pharma, with Massachusetts filing a lawsuit naming not only Purdue Pharma, but Purdue executives and the Sackler family members who’ve profited from Oxycontin sales. Here is the June 12, 2018 Massachusetts complaint naming the Sackler family as defendants, State of Massachusetts Complaint vs. Purdue Pharma and the Individual Sackler Family Members.
More than 200 opiate based lawsuits are now filed against Purdue Pharma and other opiate drug makers, distributors and pharmacies. However, the primary target in every lawsuit filed is always Purdue Pharma. These states, counties and local governments have independently sued opioid drug makers in both state and federal courts across the country, with claims alleging the opiate drug makers, distributors and now the pharmacies engaged in fraudulent marketing to sell the powerful painkillers.
They also failed to monitor and report the massive increases in opioid prescriptions flooding the US marketplace. Which has now resulted in fueling the nationwide epidemic, that’s reported to have killed over a quarter million people. The now organized approach steps up those efforts as officials sift evidence and are now holding not only the companies, but the executives and owners culpable in the designing the opioid crisis.
Purdue Pharma is facing a legal assault on many fronts, as cities, counties and states have either filed suit or are probing the company for an alleged role in the United States’ opioid and addiction epidemic.
The US government missed the opportunity to curb sales of the drug that kickstarted the opioid epidemic when it secured the only criminal conviction against the maker of OxyContin a decade ago.
Purdue Pharma hired Rudolph Giuliani, the former New York mayor and now Donald Trump’s lawyer, to head off a federal investigation in the mid-2000s into the company’s marketing of the powerful prescription painkiller at the center of an epidemic estimated to have claimed at least 300,000 lives.
While Giuliani was not able to prevent the criminal conviction over Purdue’s fraudulent claims for OxyContin’s safety and effectiveness, he was able to reach a deal to avoid a bar on Purdue doing business with the federal government which would have killed a large part of the multibillion-dollar market for the drug.
The former New York mayor also secured an agreement that greatly restricted further prosecution of the pharmaceutical company and kept its senior executives out of prison.
The US attorney who led the investigation, John Brownlee, has defended the compromise but also expressed surprise that Purdue did not face stronger action from federal regulators and further criminal investigation given its central role in the rise of the epidemic.
Connecticut-based Purdue is now facing a wave of civil lawsuits as New York, Texas and five other states have joined a growing number actions against the company. But Brownlee was the first, and so far only, prosecutor to secure a criminal conviction against the drug maker.
Brownlee launched his investigation shortly after being appointed US attorney for the western district of Virginia as the region struggled with escalating overdoses and deaths from opioids in the early 2000s. When he looked at the source of the epidemic he found OxyContin, a drug several times more powerful than any other prescription painkiller on the market at the time.
HOW OXYCONTIN FUELED THE OPIOID CRISIS
Almost 100 people are dying every day across America from opioid overdoses – more than car crashes and shootings combined. The majority of these fatalities reveal widespread addiction to powerful prescription painkillers. The crisis unfolded in the mid-90s when the US pharmaceutical industry began marketing legal narcotics, particularly OxyContin, to treat everyday pain. This slow-release opioid was vigorously promoted to doctors and, amid lax regulation and slick sales tactics, people were assured it was safe. But the drug was akin to luxury morphine, doled out like super aspirin, and highly addictive. What resulted was a commercial triumph and a public health tragedy. Belated efforts to rein in distribution fueled a resurgence of heroin and the emergence of a deadly, black market version of the synthetic opioid fentanyl. The crisis is so deep because it affects all races, regions and incomes.
Purdue turned OxyContin into a multibillion-dollar drug after its launch in 1996 with an unprecedented campaign marketing the painkiller to doctors. OxyContin contained a much higher dose of narcotic than other painkillers because it was designed to bleed slowly into a patient’s system over 12 hours and save having to take lower dosage pills more regularly. Purdue told doctors that not only was this more effective at subduing pain but it was less likely to cause addiction and more resistant to abuse by people hooked on drugs.
These were important selling points to a medical profession still wary of opioids because of concerns about addiction, and demand for OxyContin quickly surged. But it almost as swiftly became apparent to prosecutors that neither claim was true as doctors reported increasing numbers of people becoming addicted to the high dosage, and that those already hooked on opioids found it easy to extract the narcotic by crushing the pills.
OxyContin became the go-to drug for people looking for an instant high by snorting or injecting.
“This was the magic pill, right? This was a long-acting pill that the addicts wouldn’t like and you couldn’t get dependent on, and that is the magic bullet. The reality is it just wasn’t true,” said Brownlee. “It was highly deceptive and then they trained their sales force to go out and to push that deception on physicians.”
Investigators waded through several million of Purdue’s internal memos, marketing documents and notes from sales representatives. Brownlee’s office discovered training videos in which reps acted out selling the drug using the false claims. “This was pushed by the company to be marketed in an illegal way, pushed from the highest levels of the company, that in my view made them a criminal enterprise that needed to be dealt with,” said Brownlee.
When Purdue discovered it was under investigation it dispatched Giuliani, fresh from his term as mayor of New York during the 9/11 attacks, in the twin roles of heavyweight lawyer to confront the young prosecutor while also working his powerful connections in Washington. Giuliani met repeatedly with Brownlee. At first the Purdue lawyer tried to persuade the prosecutor that he had got it all wrong.
“It was basically, you need to look at the company differently. All we do is make a product and we give it to doctors and doctors ultimately make the choice,” said Brownlee.
The prosecutor heard Giuliani out but regarded his attempts to load responsibility on to doctors as missing the point. “What were the doctors being told? That was the real rub. To me the biggest evidence were the videos of the training sessions. When I saw that, you now know that this is what the corporation wants the doctors to know, and it just wasn’t true,” said Brownlee.
The US attorney had six meetings with Giuliani. They moved from how to interpret the evidence and questions around discovery to negotiations over the final settlement.
HOW GUILIANI WORKED BACK OFFICE DC CONNECTIONS
But Giuliani and his team seemed to be also working their Washington contacts. The Purdue lawyers complained to the office of the then deputy attorney general, James Comey, whose tenure as head of the FBI lay ahead of him, that Brownlee was exceeding his legal authority in pursuit of documents from the company.
“The defense lawyers contacted Mr Comey unbeknownst to us and said those guys down there are crazy,” said Brownlee. The US attorney went to Washington to explain to Comey in person. Purdue was not instantly recognizable as a pharmaceutical company to most people in DC. The name was easily mistaken for Perdue Farms, a regional chicken producer well known for its television ads featuring the owner, Frank Perdue. “Mr Comey said, why are you prosecuting the chicken guy?” said Brownlee.
Once that misunderstanding was cleared up, Comey signed off on Brownlee’s actions and Purdue was forced to hand over the documents. Brownlee set the drug maker a deadline in October 2006 to agree to the plea deal or face a trial. Hours before it expired, the federal prosecutor received a call at home from a senior justice department official, Michael Elston, chief of staff to the new deputy attorney general, Paul McNulty.
Elston asked why the case was being pushed along so rapidly and pressed for a delay. The prosecutor again saw the influence of Purdue’s lawyers at work and cut the call short. It wasn’t unusual for corporate lawyers to try to get leverage with senior justice department officials but Elston’s call, just as Purdue had its back to the wall, seemed to the then prosecutor unusually interventionist because he had shown no interest in the case before. Elston’s lawyer has since claimed that his client called Brownlee on instructions from above.
Within hours of Brownlee hanging up on Elston, Purdue accepted a plea deal admitting to criminal charges of mis-selling OxyContin with “intent to defraud or mislead”. In 2007, after a court hearing confirming the conviction, Brownlee hailed it as a “crushing defeat” for the drug maker.
But Giuliani won an important concession for Purdue. Corporations with criminal convictions are mostly barred from doing business with the federal government. If Purdue Pharma’s name was on the conviction it would probably have forced OxyContin from public health programs such as Medicaid and Medicare and the Veterans Administration health system. That in turn was likely to diminish its prescribing in the private health system.
Brownlee said he did not want to be responsible for taking OxyContin off the market and so agreed with Giuliani to target the prosecution at the parent company, Purdue Frederick. That left Purdue Pharma, cleaved out as a separate painkiller manufacturer in 1991, to continue selling the painkiller without restriction even though opioid deaths were escalating.
“I didn’t feel as a lawyer I could be in a position to bar anyone from getting OxyContin. Faced with that decision, I was just simply not prepared to take it off the market. I didn’t feel like that was my role. My role was to address prior criminal conduct. Hold them accountable. Fine them. Make sure the public knew what they did. ” said Brownlee.
Brownlee said he expected federal regulators, particularly the Food and Drug Administration, and other agencies to use the criminal conviction to look more closely at Purdue and its drug. But there was no follow-up and OxyContin went on being widely prescribed.
Purdue was fined $640m, a fraction of its total profits from OxyContin. Three Purdue executives pleaded guilty to misdemeanors and were fined a total of $34.5m between them, a reflection of their earnings from the drug.
Giuliani also won a second concession that immunized Purdue from further prosecution even though its criminal conduct continued after the period covered by the plea agreement. The prosecution covered its crimes committed up until 2001, but the mis-selling went on for years afterwards. Giuliani negotiated an agreement which immunized the company from further prosecution for its actions up to 2007 when the guilty plea was finalized in court.
Critics of the deal, such as the watchdog Public Citizen, said the company sold nearly $5bn worth of OxyContin between the two dates.
A decade later, with tens of thousands more lives claimed by the epidemic kickstarted by OxyContin, Brownlee said he does not regret his handling of the case but said he had expected other prosecutors and federal regulators to pick up the baton to rein in the spread of OxyContin.
“I think convicting the company, the fines and all of that had its impact. I guess as I sit here now, I’m a little surprised that it’s the only one of its kind. That with the nature of the abuse and the nature of the problem, that as we sit here that there’s no other out there,” he said.
PURDUE PHARMA FIRES ENTIRE SALES FORCE
As of June 20, 2018 in what is either an amazing coincidence or a look at corporate political maneuvering, just more than a week after the Sacklers and company executives were named individually in the latest Purdue Pharma opiate lawsuit, the OxyContin maker laid off its entire sales force. This puts an end to an era for Purdue that at one point, was the top-selling opioid drug in the country, and became synonymous with the nation’s opioid crisis, while the Sacklers collected billions in profits from Oxycontin sales.
Purdue, had already laid off half of its 600 sales reps in February 2018, as part of the corporate political maneuvering to curry favor with the numerous state and federal investigation that were taking place, when it announced that it would no longer be promoting OxyContin to doctors. On July 19, 2018 six days after the State of Massachusetts filed a complaint naming the company, the founding Sackler family and the executive suite as defendants in a an opioid litigation complaint, Purdue Pharma confirmed that they had terminated the remaining 220 employees in its sales force.
While Purdue still manufactures Oxycontin, which accounts for more than 80 percent of the company’s, they will be shifting its focus away from the highly lucrative opiate painkiller market, according to company sources.
WHY DIDN’T THE DEA, DRUG DISTRIBUTORS AND PHARMACIES TAKE NOTICE BEFORE THE OXYCONTIN AND OPIOID CRISIS SPREAD ACROSS THE COUNTRY LIKE WILDFIRE? WAS IT BECAUSE OF THE BILLIONS IN PROFITS, QUARTERLY BONUSES AND DIVIDENDS?
STOCK OPTIONS CASHED IN BY BOARDROOMS AT EVERY OPIOID BIG PHARMA COMPANY? STAY TUNED FOR HOW “PROFITS BEFORE PATIENTS” BECAME THE NORM
A special thanks to Stat News and Pro Publica for the 2 year fight to unseal the Purdue Pharma court documents in Kentucky State Courts which Purdue Pharma fought to prevents.
(article excerpts and quotes have been taken from publicly available media sources and court records)